Collaborative and flexible offices are being developed with hotel-like services and amenities focusing on tenants’ workplace satisfaction. The focus is on adding a premium to these offices and reaping benefits. And shared workplaces are leading the transformation.

Two offices located adjacent to each other may have different rents. It is possible as one building could be future-ready and the other may lack the necessary design creativity that meets the occupier’s expectations of a truly collaborative workspace.

Interesting office trends have emerged in recent times: While designers and architects are designing green pods for those who prefer working from home, ergonomically curated, biophilic office designs are increasing. However, the two trends are acting against each other – while the former promotes a hybrid work culture, the latter indicates a re-entry to offices, giving way to a more collaborative workforce. As the opposing ideas continue to thrive, there are common threads — workspaces are being designed to incorporate keeping in mind the well-being of the occupiers, and offices are getting equipped with a wide range of amenities. The impact is visible on the rent these offices demand.

The hotelisation of offices indicates the workplace transformation into a commercial space like a hotel. It treats tenants as valued guests and provides building occupants with the same quality of service as they would find in the hospitality sector.

And the hotelisation of the workspace is here to stay.

So what is changing?

The coronavirus has been a game-changer for offices. More than two years into the pandemic, working from home or remotely seems like an increasingly permanent proposition. With people wanting to increasingly work in a hybrid mode, workplace evolution has picked pace. Features like “plug and play” are offered to all. Access to a cafeteria or a cloud kitchen, tenants’ lounges, coffee bar, parking, concierge, shuttle buses, discount deals from local restaurants and shops, conference centre management, internal community events, fitness centre and wellness classes are all features of the hotelised workplace.

Ergonomically designed workplaces with biophilic features are said to enhance the connectivity of building occupants with the natural environment through direct and indirect nature and space and place conditions. The design includes an open office design, hot-desking, and coworking spaces. Hence, the evolved workplace design is an open and collaborative environment that makes people feel welcome and energized to work.

The factors behind

The way businesses approach real estate decisions is being reshaped by technological advancements, a more mobile workforce, and uncertain economic growth. Amidst the uncertainty, landlords have realized that to improve tenant retention, command better rental values and create future-ready offices, they need to take a more service-oriented role. And occupiers continue to demand more flexible lease terms, better quality in-house services and enhanced offerings for well-rounded end-user experiences.

The impact

The trend is already impacting the design of commercial real estate (CRE). First, it has pushed landlords and occupiers towards better asset management practices. As a result, landlords now focus on getting the right set of services and designing a more open and collaborative workspace.

Second, the trend has fundamentally spurred demand for quality offices. Both old and new portfolios are being developed to meet the high demand. Hence, various redevelopment projects have resurfaced, adding to Grade A supply of offices. And shared workplaces are leading this change.

The upside of hotelisation

Hotels have a unique selling proposition that businesses want to replicate, like having a 24/7 service, a consistent and standardized experience, and a host of facilities. There is more focus on creating a warm and welcoming environment by incorporating different elements like the use of natural light, nature sounds, furnishing with upholstery, and other materials that are not typical in an office environment.

Hotelisation is now a way to future-proof the existing buildings. It is helping building owners to command higher rents and remain relevant for tenants in a pandemic-like situation – a trend visible with leading shared office operators. The transformative strategy of hotelisation worked for most of these operators, who wanted to differentiate their offerings through customized service offerings.

However, office owners should exercise caution. As one replicates the services of a hotel, he must strike a balance between catering to tenants’ higher expectations and the incremental costs associated with designing, building and managing high-quality amenities. Focusing on people-oriented services might add to the overall experience. That should hold bring success in the long run.

(By Sumit Lakhani, Deputy CEO, Awfis)

This story appeared in the 28 November, 2022 issue of Financial Express and was originally published at: Future-proofing the workspace through hotelisation

Ease of doing business for MSMEs: Among sectors, banking, insurance and technology companies will lead the demand for office spaces in 2023 as the financial services industry’s quick embrace of digital platforms and the availability of tech-savvy individuals in India, the survey said.

Ease of doing business for MSMEs: More than a year after the Covid pandemic peaked in the country, a number of large businesses are still looking comfortable with the hybrid mode of working in comparison to small businesses. According to a survey by co-working companies Awfis and Qdesq, while 70 per cent of large businesses surveyed are in favour of working in a hybrid mode, more than 70 per cent of small business respondents in the survey cited work from office as their preferred mode of work.

The report Indian Flex Occupier’s Survey 2022, however, didn’t mention the survey methodology including the number and size of businesses surveyed, the duration of the survey and the process of recording respondents’ feedback.

Amit Ramani, Founder & CEO, Awfis said the long-term future of the entire business will be determined by the current occupier patterns, which are also creating new expansion opportunities for flex space operators in the short term.

“This is an opportune time for flex space operators to reinvent their workspaces, diversify their presence in cities, and carefully analyse tenant expectations to accommodate them effectively as flexibility continues to hold sway over workplace strategies of enterprises of all sizes.”

“This is an opportune time for flex space operators to reinvent their workspaces, diversify their presence in cities, and carefully analyse tenant expectations to accommodate them effectively as flexibility continues to hold sway over workplace strategies of enterprises of all sizes.”

A similar survey on workplace strategy conducted by commercial real estate services provider Colliers in September this year noted that 60 per cent of small firms are currently working all days from their offices while only 10 per cent of the large enterprises are preferring five-day work from office, indicating that offices are finding more favour from small businesses. The survey was conducted in May and June this year and received 300 responses from ‘occupiers’ including small, mid and large-sized firms in India.

The market for co-working space has grown steadily over the last few years with businesses looking to go hybrid particularly post-Covid. There were close to 3.7 lakh flexi seats spread across tier 1 and tier 2 cities across the country and was estimated to grow at the rate of 15 per cent, compounded annually, for the next five years, a report by real estate services company Anarock and CII in December last year noted. According to the report, there was nearly 35 million square feet of total flexible stock available across the country, of which 71 per cent was from large players.

This story appeared in the 23 November, 2022 issue of Financial Express and was originally published at: A number of small businesses want employees to work from office instead of WFH or hybrid: Survey

Occupiers are looking at adoption of flex spaces as the most preferred choice, where offering flexibility to employees and promoting work-life balance will be the protagonists.

As the third wave of Covid-19 started waning in February this year, the return to office gained momentum after a gap of two years. As a result, by June 2022, about 34% of the companies saw about 75-100% of the employees back in office (including hybrid work), according to a C-Suite Survey conducted by Colliers and Awfis.

With a drop in the number of Covid-19 infections and an increase in the rate of vaccination, employers gradually started reopening the workspaces for their employees. However, a shift in the working patterns was seen as employers started offering hybrid working options to their employees.

Further, occupiers are looking at increased agility for their real estate portfolios. Distributed workspace patterns and hybrid work environment are the new reality that occupiers are embracing. Occupiers are looking at adoption of flex spaces as the most preferred choice, where offering flexibility to employees and promoting work-life balance will be the protagonists.

As per the survey, about 74% of the occupiers are looking towards distributed workspaces as a strategy to shift from location-centric to people-centric workspaces. This will enable flexibility to employees while furthering productivity gains for businesses.

While 54% of the occupiers who highly prefer distributed workspace are from the IT/ITES, followed by Consulting and New Tech (Analytics) companies, 44% of the occupiers who do not prefer to execute distributed workspaces are majorly from IT/ITES, followed by E-commerce and consulting companies.

Close to 53% occupiers prefer working from home + office as their preferred portfolio strategy.

The survey was conducted during May-June 2022 for occupiers across different sectors such as IT/ITeS, BFSI, engineering and manufacturing and others. A total of about 150 responses were received from C-Suite executives spanning Founders, CEOs, COOs and CHROs of various companies. The company size of the respondents varied, starting from the range 1500 employees to companies having over 10,000 employees.

“To understand how occupiers are reimagining their future workplaces, Colliers and flex space operator Awfis conducted a survey with CXOs to understand their strategies regarding distributed workplaces and role of flex spaces. Occupiers are looking for a workplace model that not only furthers their business goals, but also creates a comfortable working environment for the employees. Employee wellness has now become an integral part of real estate decision-making for occupiers. Occupiers are paying heed to aspects such as work-life balance and the mental well-being of employees. As occupiers weave in employees’ wellbeing along with furthering business goals, we see an overarching theme of distributed workplaces in their plans,” said Ramesh Nair, Chief Executive Officer | India and Managing Director, Market Development | Asia, Colliers.

“A distributed workplace can be in several forms – mix of flex spaces and traditional office in the same city; multi-offices in the same city `ala a hub and spoke model; a mix of flex space and traditional offices across tier I and tier II cities – No one size fits all. The approach towards distributed workplaces is now propelling the growth of flex spaces in metro cities, with flex operators also making inroads into tier II cities. Flex operators have already leased 3.5 million sq feet of office space during H1 2022 in the top six cities, about 73% of the space leased in full year in 2021. In tier II cities, flex spaces are likely to grow more than two-fold to 5.5 million sq feet by the end of 2022,” Nair added.

“As businesses reinstitute their operations and the world races back to normalcy, organizations are seeking innovative workplace strategies that do not hinder employee productivity levels achieved during remote working. While few organizations still hold onto the work-from-home model intending to uphold operational overheads, others have prioritized flexibility as the crucial determinant in devising their post-pandemic workspace strategy. Amid this accelerated business recovery, there is a growing perplexity among organizations to select the ideal workplace model to conduct operations in full swing and distributed workforce strategy stands out as the most sustainable option,” said Amit Ramani, Founder & CEO, Awfis.

Going ahead, over the course of the next two years, occupiers approaching their lease expiry are likely to explore relocation options. As a result, occupiers are likely to include distributed workspaces as a part of their portfolio strategy. This is likely to include one head office near the CBD/SBD, with multiple smaller offices near larger residential locations. Opting for distributed workspaces can allow occupiers to operate in a hybrid work-from-home model and keep their capital expenditure low.

This story appeared in the 4 August, 2022 issue of Financial Express and was originally published at: 53% occupiers prefer working from home + office: Survey